Toyota maintains 23-year streak as BYD upends Australian auto market

Australia’s new vehicle market has defied cost-of-living headwinds to post its third consecutive year of record sales, with more than 1.24 million vehicles sold in 2025.

While higher interest rates and economic uncertainty moderated growth compared to the post-pandemic surge, the annual VFACTS data reveals a market in the midst of a structural shift. Traditional sedans are in terminal decline, while the battle for "clean" dominance has moved from pure battery electric vehicles (BEVs) to a resurgence in hybrids.

Despite intensifying competition from Chinese entrants, Toyota remains the industry’s immovable object. The Japanese giant sold 239,863 vehicles in 2025, commanding a 19.8% market share and securing its 23rd consecutive year as Australia’s market leader.

Toyota’s resilience is built on the back of its SUV and ute stables, with the RAV4, HiLux, and Prado all finishing in the national top five. Ford secured the second spot (94,399 units), largely carried by the Ford Ranger, which officially claimed the title of Australia’s best-selling vehicle for the year.

While Toyota led on volume, BYD provided the year's most aggressive growth story. The Chinese electric vehicle challenger grew its market share from 1.7% to 4.3% in just 12 months.

SEE MORE: BYD topples Tesla, brings its luxury brand Denza to Australia

With 52,415 sales, BYD’s volume jumped 156% year-on-year – the strongest growth of any major marque. This surge is part of a broader China story of the local auto market. Vehicles manufactured in China now account for 18% of total sales, trailing only Japan and Thailand.

The data suggests the "EV-only" narrative hit a speed bump in 2025. While battery electric vehicle (BEV) growth was subdued – impacted heavily by a 25% slump in Tesla sales – plug-in hybrids emerged as the industry's new darling. Sales more than doubled to 53,484 units, while conventional hybrids grew 15.3% to nearly 200,000 units.

“Consumers are responding to a wide range of models that meet their needs,” said FCAI chief executive Tony Weber. “The market continues to evolve as new technologies become more widely available.”

A structural decline

The shift in consumer taste away from traditional formats is now almost total. SUVs accounted for a staggering 60.7% of all sales in 2025, while passenger vehicles (sedans and hatchbacks) plummeted by 22.6%.

As the industry prepares for the New Vehicle Efficiency Standard (NVES) emissions limits, the 2025 results suggest that while the "arms race" for electrification is well underway, Australian buyers are currently betting on hybridity over pure-play electric.